Spouse Sole IRA Beneficiary
In 2020 husband (age 75) died leaving wife (age 68) sole IRA beneficiary.
There was no RMD taken in 2020 since that was not required last year.
To date nothing has been done with the husband’s account since the husband died. No distributions were taken in 2021 and no paperwork has been submitted to the custodian. The account is still titled in the deceased spouse’s name as before.
If paperwork is not submitted to the custodian until January 2022 are there any adverse consequences? The surviving spouse does plan to roll over the husband’s IRA account to her own IRA but the concern is that if the account remains as is for the remainder of 2021 then that could be a problem.
Thank you.
Permalink Submitted by Alan - IRA critic on Tue, 2021-12-21 18:03
The sole spouse beneficiary RMD default rule should take care of this nicely. When the surviving spouse fails to take a beneficiary RMD as required, they default to ownership status for that year. As the owner the wife will have no 2021 RMD and will not have RMDs until she reaches 72. But she should still have the inherited IRA setup with an immediate election made to assume ownership so the account reflects the RMD default rule to ownership. Even if this does not get done until 2022, there are no adverse consequences. She will still be treated as the owner for the entire 2021 year.
Permalink Submitted by Mark Reich on Tue, 2021-12-21 18:16
Thank you! The spouse will be relieved! (As will I!)